iPedia Free Information Center

Information about Personal Finance

Personal finance
Credit and Debt
Credit card
Credit union
Debit card
Debt consolidation
Loan
Money lender
Mortgage
Employment contract
Salary
Wage
Paycheck
Employee stock options
Employee benefit
Direct deposit
Retirement
Retirement plan
IRA
Pension
Social security
Business plan
Corporate action
Financial Planning
Financial adviser
Estate planning
Finance series
Financial markets
Financial market participants
Corporate finance
Personal finance
Public finance
Banks and Banking
Financial regulation
Personal finance is the application of the principles of finance to the monetary decisions of an individual or family unit. It addresses the ways in which individuals or families obtain, budget, save and spend monetary resources over time, taking into account various financial risks and future life events. Components of personal finance might include checking and savings accounts, credit cards and consumer loans, investments in the stock market, retirement plans, social security benefits, insurance policies, and income tax management.

Personal financial planning

A key component of personal finance is financial planning, a dynamic process that requires regular monitoring and reevaluation. In general, it has five steps:
  1. Assessment: One's personal financial situation can be assessed by compiling simplified versions of financial balance sheets and income statements. A personal balance sheet lists the values of personal assets (e.g., car, house, clothes, stocks, bank account), along with personal liabilities (e.g., credit card debt, bank loan, mortgage). A personal cash flow statement lists personal income and expenses.
  2. Setting goals: Two examples are "retire at age 65 with a personal net worth of $200,000 American" and "buy a house in 3 years paying a monthly mortgage servicing cost that is no more than 25% of my gross income". It is not uncommon to have several goals, some short term and some long term. Setting financial goals helps direct financial planning.
  3. Creating a plan: The financial plan details how to accomplish your goals. It could include, for example, reducing unnecessary expenses, increasing one's employment income, or investing in the stock market.
  4. Execution: Execution of one's personal financial plan often requires discipline and perseverance. Many people obtain assistance from professionals such as accountants, financial planners, investment advisers, and lawyers.
  5. Monitoring and reassessment: As time passes, one's personal financial plan must be monitored for possible adjustments or reassessments.


Typical goals most adults have are paying off credit card and or student loan debt, retirement, college costs for children, medical expenses, and estate planning.

See also

References

  • Kwok, H., Milevsky, M., and Robinson, C. (1994) Asset Allocation, Life Expectancy, and Shortfall, Financial Services Review, 1994, vol 3(2), pg. 109-126.
  • The Ernst and Young Tax Guide 2007 by Ernst & Young LLP, Peter W. Bernstein - Paperback - ISBN 1-59315-434-8.
 •  • [ e]
General areas of finance
Financial markets • Investment management • Financial institutions • Personal finance • Public finance • Mathematical finance • Financial economics • Experimental finance • Computational finance
Credit is the provision of resources (such as granting a loan) by one party to another party where that second party does not immediately pay the first party for the resources in full, thereby generating a debt, and instead arranges either to pay for or to return those resources
..... Click the link for more information.
Debt is that which is owed; usually referencing assets owed, but the term can cover other obligations. In the case of assets, debt is a means of using future purchasing power in the present before a summation has been earned.
..... Click the link for more information.


A credit card is a system of payment named after the small plastic card issued to users of the system. A credit card is different from a debit card in that it does not remove money from the user's account after every transaction.
..... Click the link for more information.
A credit union is a cooperative financial institution that is owned and controlled by its members. Credit unions differ from banks and other financial institutions in that the members who have accounts in the credit union are the owners of the credit union.
..... Click the link for more information.
This article may be too long.
Please discuss this issue on the talk page and help summarize or split the content into subarticles of an article series.

A debit card is a plastic card which provides an alternative payment method to cash when making purchases.
..... Click the link for more information.
Debt consolidation entails taking out one loan to pay off many others. This is often done to secure a lower interest rate, secure a fixed interest rate or for the convenience of servicing only one loan.
..... Click the link for more information.
A loan is a type of debt. All material things can be lent but this article focuses exclusively on monetary loans. Like all debt instruments, a loan entails the redistribution of financial assets over time, between the and the .
..... Click the link for more information.

Historical meaning

The historic use of the term Money lender refers to a person who as charges a fee for the use of money (i.e. a usuror).

Contemporary meaning

The contemporary use of the term Money lender refers to a person or business organization that offers
..... Click the link for more information.
Property law
Part of the common law series
Acquisition of property
Gift  · Adverse possession  · Deed
Lost, mislaid, and abandoned property
Alienation  · Bailment  · License
Estates in land
..... Click the link for more information.
An '''employnd, sometimes, garden leave.

Some employers also use non-disclosure and non-compete clauses to protect their trade secrets from being dispersed when employees leave. Depending on where you live, the laws regarding enforcability of these clauses vary widely.
..... Click the link for more information.
worldwide view of the subject.
Please [ improve this article] or discuss the issue on the talk page.


A salary is a form of periodic payment from an employer to an employee, which is specified in an employment contract.
..... Click the link for more information.
WAGE can refer to:
  • Wide Area GPS Enhancement
  • WAGE (AM), an AM radio station located in Leesburg, Virginia
A wage is a compensation which workers receive in exchange for their labor.
..... Click the link for more information.
A paycheck is a method of paying someone on a payroll.

Paycheck can also refer to:
  • Paycheck (short story), short story by science fiction author Philip K. Dick
  • Paycheck (film), film adaptation of the Philip K.

..... Click the link for more information.
An employee stock option is a call option on the common stock of a company, issued as a form of non-cash compensation. Restrictions on the option (such as vesting and limited transferability) attempt to align the holder's interest with those of the business' shareholders.
..... Click the link for more information.
This article has too many unnecessary external links.
Please help Wikipedia by organising, removing or transferring them to other articles.


Employee benefits and (especially in British English)
..... Click the link for more information.
Direct deposit is a banking term used to refer to certain systems used to transfer money, namely:
  • In Europe, the giro system
  • In the United States, the Automated Clearing House

..... Click the link for more information.
Retirement is the point where a person stops employment completely. A person may also semi-retire and keep some sort of retirement job, out of choice rather than necessity.
..... Click the link for more information.
A retirement plan is an arrangement to provide people with an income, or pension, during retirement, when they are no longer earning a steady income from employment. Retirement plans may be set up by employers, insurance companies, the government or other institutions such as
..... Click the link for more information.
Taxation in the United States

This article is part of the series:
Politics and government of
the United States


Federal taxation
History Internal Revenue Service
Tax Court   Tax forms

Income tax   Payroll tax
..... Click the link for more information.
worldwide view of the subject.
Please [ improve this article] or discuss the issue on the talk page.
For the lodging, see .
A pension is a steady income given to a person (usually after retirement).
..... Click the link for more information.
The term Social Security has several uses.
  • Canada Pension Plan - Canadian Social Insurance
  • Social security - the general concept of providing welfare
  • Social Security (United States) - the United States retirement/disability program

..... Click the link for more information.
business plan is a formal statement of a set of business goals, the reasons why they are believed attainable, and the plan for reaching those goals. It may also contain background information about the organization or team attempting to reach those goals.
..... Click the link for more information.
A corporate action is an event initiated by a public company that affects the securities (equity or debt) issued by the company. Some corporate actions such as a dividend (for equity securities) or coupon payment (for debt securities (bonds)) may have a direct financial
..... Click the link for more information.
A Financial Planner or Personal Financial Planner is a practicing professional who helps people to deal with various personal financial issues through proper planning, which includes but is not limited to these major areas: tertiary education planning, retirement planning,
..... Click the link for more information.
A financial adviser is a professional who renders investment advice and financial planning services to individuals and businesses. Ideally, the financial adviser helps the client maximize their net worth by proper asset allocation.
..... Click the link for more information.
The Law of Wills, Trusts and Inheritance
Part of the common law series
Wills
Wills  · Holographic will
Joint wills and mutual wills  · Will contract
Codicils
Parts of a Will
Attestation clause  · Residuary clause
..... Click the link for more information.
Finance studies and addresses the ways in which individuals, businesses, and organizations raise, allocate, and use monetary resources over time, taking into account the risks entailed in their projects.
..... Click the link for more information.
In economics, a financial market is a mechanism that allows people to easily buy and sell (trade) financial securities (such as stocks and bonds), commodities (such as precious metals or agricultural goods), and other fungible items of value at low transaction costs and at prices
..... Click the link for more information.
financial market participant categories, Investor vs. Speculator and Institutional vs. Retail. Action in financial market by Central banks is usually regarded as intervention rather than participation, although evidence exists in the Sprott '"Visible Hand of Uncle Sam"' report that
..... Click the link for more information.
Corporate finance is an area of finance dealing with the financial decisions corporations make and the tools and analysis used to make these decisions. The primary goal of corporate finance is to enhance corporate value while reducing the firm's financial risks.
..... Click the link for more information.


This article is copied from an article on Wikipedia.org - the free encyclopedia created and edited by online user community. The text was not checked or edited by anyone on our staff. Although the vast majority of the wikipedia encyclopedia articles provide accurate and timely information please do not assume the accuracy of any particular article. This article is distributed under the terms of GNU Free Documentation License.
Herod_Archelaus


page counter